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EU: the end of roaming charges and the emergence of net neutrality

On 30 June 2015 the European Commission (“EC“) secured an agreement with the European Parliament and the Council to end roaming charges and to put in place the first EU-wide net neutrality rules in the latest move to establish a single EU market in telecoms. This agreement comes within the wider context of the recently announced Digital Single Market strategy which is currently at the top of the agenda for the EC.

Two significant developments emerge from the agreement:

From June 2017, EU citizens will no longer have to pay extra charges to use their mobile phones whilst travelling within the EU – they will pay the same price for calls, texts and mobile data as they do at home; and

From April 2016 internet content must be offered to all EU citizens freely without discrimination as part of new strong “net neutrality” rules to safeguard the open Internet.

Roaming

The EC has been working for over a decade to decrease roaming charges within the EU – there has already been significant reductions in the cost of sending text messages and data roaming whilst abroad (down 80% and 91% respectively since 2007). Currently the European Union’s (“EU“) roaming rules provide for retail roaming caps of €0.19 per minute of calls made, €0.06 per SMS sent, and €0.20 per MB of data exclusive of VAT. However, the recently announced planned changes go a step further by banning these extra costs entirely from June 2017.

However, under the new rules, a capping mechanism will apply as a “fair-use” safeguard to prevent abuses and avoid scenarios where a user buys a mobile phone subscription in a “cheaper” Member State where he is not domiciled and takes it home i.e. “permanent roaming”. As such, after a certain level of usage abroad is reached a small fee can become payable but the question remains on where the threshold will be set. The EC have confirmed that this fee will be “much lower than current caps (maximum prices that operators can charge consumers for roaming in the EU) and is likely to decrease even further.” The EC has been authorized to define the details of this fair use limit.

Before the eradication of roaming charges altogether in 2017, prices will be reduced even further -from April 2016 operators will only be able to charge up to €0.05 per minute of calls made, €0.02 per SMS sent, and €0.20 per MB of data exclusive of VAT).

Net- Neutrality

Net neutrality will harmonise at an EU level the rules on internet access. These new rules will have a significant impact on how content is offered online and contribute to the development of a Digital Single Market- as the EC states, “in a Digital Single Market, we cannot afford that 28 Member States adopt 28 different approaches on that issue… having an EU law on net neutrality will avoid further fragmentation of telecoms regulation in Europe.”

The main focus of the net neutrality rules is to ensure that users have free unlimited choice of content – unfair transmission blocks and prioritisation will no longer be allowed. As the EC states “every European must be able to have access to the open Internet and all content and service providers must be able to provide their services via a high-quality open Internet“. All traffic will be treated equally subject only to technical maintenance requirements for managing network congestion and clearly identified and strict public interest exceptions such as network security or combating child pornography.

The EC views net neutrality as essential to ensure that innovation online is effective and that small star-up companies can compete with larger players without being blocked out.

Internet access providers will be able to continue to offer specialised, innovative services of higher quality, such as Internet TV, automated driving, HD video conferencing and healthcare services like telesurgery. The EC explains that these services “use the Internet protocol and the same access network but need an improvement in quality or the sibility to guarantee certain technical requirements to end-users that cannot be ensured in the open Internet.” The EC has clarified that this will not create a two-tier internet as these high-end transmissions will only be permitted as long as they do not negatively impact on the free open internet.

The EC has stated that the new agreement is intended to increase consumer protection by empowering users to detect possible breach of open Internet rules and informing them of their roaming rights and data consumption.

Next Steps

Before the rules can come into force, the text must be officially approved by the European Parliament and the Council, translated into all EU languages and published in the Official Journal. These measures will be completed by an overhaul of EU telecoms rules in 2016.

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